Research Paper: Tyco International Ltd. After Kozlowski

Pages: 5 (1452 words)  ·  Bibliography Sources: 3  ·  Level: College Junior  ·  Topic: Business  ·  Buy This Paper


[. . .] The company will end up with assets that are little to their worth in further with no ability to replace them of dispose them off (Desai, Hogan and Wilkins 46).

Free cash Flow

The alternative cash flow that is can be used in gauging a company's normal flow of cash is known as free cash flow. Free cash flow calculations are not included in the cash flow since they include the funds available to the suppliers of capital, owners and creditors. (Duttweiler 46) defines free cash flow as the cash that is generated in a business available for distribution and share among the security holders, many investor consider free cash flow as the best measure to reflect a company's ability to generate cash. This observation is made since free cash flow is not normally put to use in the normal running of a business. Rather, free cash flow is pegged for paying dividends, reservation for future acquisition of capital, development of new products and expansion of business operation in regions (Duttweiler 48).

Consideration made by Mr. Breen to focus on free cash flow in the first years is to reduce the debt burden held by the company. This consideration complements the liquidity crises since the company had no other viable measure to meet its obligation. Considering the nature of its assets, Mr. Breen's evaluation directed him to appreciate that there were no immediate alternatives to come up with cash without undesirable loss in value.

The use of free cash flow is an ideal measure to alter future cash flow and earning within a company. As opposed to increasing its debts, through borrowing with interests charged, use of available cash flow is preferred. The company is also much better suited compromising the owners and security holder in the short-run to avert eminent need to file for bankruptcy. Free cash flow uses can open avenues to increase profitability and reinstate outside stakeholder confidence in the company. This measure will hedge the company towards more sustainable relation with potential business partners.

Company forecast reports

Mr. Breen observes that the desire for many to evaluate performance through the short run performance in misguided. It is possible to concentrate much on short sited gains and miss out on ideal long-term goals. The potential of a company to perform in the longer term is driven not only by its short-term performances but, also on the orientation focus on the future. Detailed concentration on posting meaning strides in the short-run can work to hinder the company from attaining growth and sustainability (Desai, Hogan and Wilkins 91).

Mr. Breen perspective on providing information on Wall Street analyst looks back to the way Kozlowski sought to entrench good will upon himself with the stakeholder. The hedging attained through Wall Street analysis based on creating the company's value to the shareholders. This measure is blind to the need for these shareholders to benefit from meaningful long-term growth. The measure is also blind to the corporations need entrench a value for customers and business through developments instituting productivity and efficiency (Desai, Hogan and Wilkins 93).

Given the perspective by Mr. Breen, the greeter perspective is using the short-term gains to leverage potential successful future. The commitment to short-term gains, can easily be achieve but the sacrifice of any further future gains.

Opinion on corporations, U.S. economy and Governmental reform changes

US Corporation operate in a dynamic environment where the re-inventions and evaluations necessitate the eminent changes. The corporations are thus well equipped to operate under any system of governance. Corporations in America are not wary of change since the change in the environment work to clear pathways for exploitation.

On the government composition, there is no way this will alter the corporation perspective in ensuring profitability. Companies will respond to the stimuli in the operation and alter action. Reforms in the government are expected to come in after the 2012 presidential election, and these are not limited to any candidate in particular (Lublin).

Works Sited

Desai, H., Hogan, and M. Wilkins. "The Reputational Penalty for Aggressive Accounting: Earnings Restatements and Management Turnover." The Accounting Review 18.1 (2006): 83-112. Print.

Duttweiler, R. Managing Liquidity in Banks: A Top Down Approach. John Wiley & Sons, 2011: John Wiley & Sons, 2011. Print.

Harrison Jr., W., C.T. Horngren, and C.T William. Financial Accounting 9th Edition. U.S.A.: Prentice Hall… [END OF PREVIEW]

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Tyco International Ltd. After Kozlowski.  (2012, December 1).  Retrieved September 16, 2019, from

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"Tyco International Ltd. After Kozlowski."  December 1, 2012.  Accessed September 16, 2019.